Gas prices jump at Connecticut pumps

The price of a gallon of regular unleaded gas hit $3.77 in the Norwich-New London area Friday, a nearly 4 percent increase since the first of the year, according to a new report by the American Automobile Association.

"Prices remained pretty steady for most of January, but then in the last week they increased about 10 and a half cents," said Aaron Kupec, public affair manager for AAA in West Hartford.

Kupec pointed out that the Norwich-New London region experienced a much bigger bump in gas prices than the rest of Connecticut. The state as a whole saw about a 3 percent rise in prices.

Kupec pointed out that Connecticut - with the fourth-highest gas prices in the nation - actually had a smaller increase in fuel costs than the United States as a whole, which saw a 4 percent spike over the past month.

But he warned that prices may escalate further, especially after a planned closure at Hess Corp.'s 70,000-barrel-a-day Port Reading, N.J., refinery is completed by the end of this month. The facility provides 7.5 percent of the gasoline consumed in the Northeast.

"The next few months may be difficult," Kupec said.

Kupec said zone pricing could be responsible for some of the price discrepancies seen this month among the various regions of Connecticut. Under a zone pricing system, according to a state Office of Legislative Research report issued in 2006, suppliers of motor fuel set their wholesale price according to certain boundaries that they refuse to identify for competitive reasons and which Kupec said could be as many as several dozen.

"Each supplier decides for itself whether and where to have price zones," the report said. "Where price zones exist, suppliers consider such factors as local competition among retailers and geography."

While zoning worked out in favor of the Norwich-New London region around Thanksgiving, when the area had among the lowest gas prices in Connecticut, the cost of motor fuel now is closer to the statewide average.

Though gas prices have spiked in the past month, they are not significantly higher than last year at this time, when they averaged $3.74 a gallon, only 3 cents lower than today.

The average national price for unleaded gas is $3.35, 7 cents cheaper than a year ago.

"The retail price of gasoline has now increased for 11 consecutive days, the longest such streak since prices rose for 21 straight days July 28-Aug. 18 (of last year)," according to AAA.